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MT Masterclass - Performance management

What is it? Nothing could be simpler than managing people to get better performance out of them, right? If that were true, there would be no UK productivity problems and a million consultants would be out of work. Effective performance management seems to be beyond far too many bosses. Setting targets, motivating staff and appraising performance sounds straightforward enough, but the underperformance of organisations suggests otherwise.

Where did it come from? When workers could simply be ordered to do as they were told, bosses didn't see the need to manage performance. Production targets were hit, or they weren't, and employees could be sacked or hired as the order book dictated. But with the growth of trade unionism, the idea that workers should be treated as more than mere factors of production grew. In 1911, US engineer Frederick Taylor published The Principles of Scientific Management, which claimed: 'The principal object of management should be to secure the maximum prosperity for the employer, coupled with the maximum prosperity for each employee.'

Where's it going? Managers continue to struggle with the implications of Taylor's challenge. Not nearly enough organisations get performance management right: targets are set, missed - and that's when the fun really starts. Blame flies around and performance falls further. In desperation, some firms slice off the bottom 5%-10% of performers every year. But that's not management - that's a cull. Until some realism is introduced, bosses quoting 'hit' targets will continue to sound like former Soviet leaders declaring this year's grain harvest an 'unprecedented success'.